LRB-2471/4
RCT:jlg&kmg:km
1997 - 1998 LEGISLATURE
August 21, 1997 - Introduced by Senators Shibilski, Welch and Zien, cosponsored
by Representatives Sykora, Ott, Gronemus, Springer and Zukowski.
Referred to Committee on Agriculture and Environmental Resources.
SB275,1,5 1An Act to renumber and amend 127.01 (18) and 127.069 (1); to amend 127.01
2(5p), 127.01 (5r), 127.06 (1) (a) (intro.), 127.06 (1m) (c) 1., 127.09 (4) and 127.10
3(5); and to create 127.01 (18) (c), 127.03 (6), 127.06 (1m) (c) 1m., 127.069 (1) (a)
4(intro.), 127.069 (1) (a) 2., 127.069 (2) (a) 4. and 127.09 (6) of the statutes;
5relating to: regulation of grain dealers and grain warehouse keepers.
Analysis by the Legislative Reference Bureau
This bill makes several changes in the laws regulating grain dealers. A grain
dealer buys grain from and sells grain for growers. The department of agriculture,
trade and consumer protection (DATCP) administers the laws regulating grain
dealers.
Under current law, a grain dealer that buys or sells at least $2,000,000 worth
of grain from growers during a year must file an audited financial statement with
DATCP. If the grain dealer buys or sells less grain, the grain dealer's financial
statement generally need not be audited. This bill provides that a grain dealer who
buys or sells at least $2,000,000 but less than $3,000,000 worth of grain in a year is
required to file an audited financial statement only if the grain dealer bought or sold
at least $2,000,000 worth of grain during the previous year.
Under current law, there are several different classes of grain dealers. The
licensing fees and regulatory requirements imposed on a grain dealer vary to some
extent depending on the grain dealer's class. Currently, to be a Class B or Class B2
grain dealer, a person may purchase grain from growers only in connection with the

operation of a feed mill or other manufacturing facility. Under this bill, a person does
not cease to be a Class B or Class B2 grain dealer because the person sells grain to
other grain dealers, as long as the amount received for that grain in a year does not
exceed 20% of the amount that the person spends to buy grain from growers during
that year.
Under current law, certain grain dealers who do not meet specified financial
standards are required to file monthly reports with DATCP. This bill requires a grain
dealer who has filed a bond or other security with DATCP for the benefit of producers
to file monthly reports with DATCP.
This bill provides that the purchase of grain that has been processed does not
subject a person to regulation as a grain dealer. The bill also makes minor changes
concerning when a grain dealer must provide a written copy of a contract to a grower
and when a grain dealer must pay a grower for grain if the grain dealer takes custody
of the grain before paying the grower for the grain.
This bill also makes changes in the law relating to grain warehouse keepers.
A grain warehouse keeper stores grain for growers and others (depositors). Under
current law, a grain warehouse keeper who does not meet specified financial
standards is required to file monthly reports with DATCP. This bill requires a grain
warehouse keeper who has filed a bond or other security with DATCP for the benefit
of depositors to file monthly reports with DATCP. The bill also requires a grain
warehouse keeper who delivers grain owned by a depositor to another warehouse
keeper for storage to obtain a nonnegotiable receipt for the grain from the other
warehouse keeper.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB275, s. 1 1Section 1. 127.01 (5p) of the statutes is amended to read:
SB275,2,62 127.01 (5p) "Class B grain dealer" means a person, other than a Class B2 grain
3dealer, who buys grain from producers only in connection with the operation of a feed
4mill or other manufacturing facility operated by that person, except as provided in
5s. 127.03 (6),
and who spends less than $400,000 during that person's fiscal year to
6buy grain from producers.
SB275, s. 2 7Section 2. 127.01 (5r) of the statutes is amended to read:
SB275,3,6
1127.01 (5r) "Class B2 grain dealer" means a person who buys grain from
2producers only in connection with the operation of a feed mill or other manufacturing
3facility operated by that person, except as provided in s. 127.03 (6), who spends less
4than $50,000 during that person's fiscal year to buy grain from producers and who
5does not buy any grain under a deferred payment contract or a deferred price
6contract.
SB275, s. 3 7Section 3. 127.01 (18) of the statutes is renumbered 127.01 (18) (intro.) and
8amended to read:
SB275,3,129 127.01 (18) (intro.) "Grain" means corn, wheat, soybeans, oats, barley, rye,
10buckwheat, sorghum, flaxseed, milo, sunflower seed and mixed grain as defined in
11the federal grain standards act, 7 USC 71 to 87k. "Grain", except that "grain" does
12not include any of the following:
SB275,3,13 13(a) Sweet corn or other canning crops for processing or grain.
SB275,3,16 14(b) Seed corn or wheat, soybeans, oats, barley, rye, buckwheat, sorghum,
15flaxseed, milo, sunflower seed or mixed grain
used or intended for use solely for
16planting purposes.
SB275, s. 4 17Section 4. 127.01 (18) (c) of the statutes is created to read:
SB275,3,2018 127.01 (18) (c) Any corn, wheat, soybeans, oats, barley, rye, buckwheat,
19sorghum, flaxseed, milo, sunflower seed or mixed grain that has been rolled, cracked,
20roasted or otherwise processed.
SB275, s. 5 21Section 5. 127.03 (6) of the statutes is created to read:
SB275,4,222 127.03 (6) Sales by certain grain dealers. A person does not cease to be a Class
23B grain dealer or Class B2 grain dealer because the person sells grain to other grain
24dealers, as long as the amount received from the other grain dealers for the grain sold

1during the person's fiscal year does not exceed 20% of the amount that the person
2spends to buy grain from producers during that fiscal year.
SB275, s. 6 3Section 6. 127.06 (1) (a) (intro.) of the statutes is amended to read:
SB275,4,54 127.06 (1) (a) (intro.) A warehouse keeper licensed or required to be licensed
5under s. 127.02 (1) shall do all of the following:
SB275, s. 7 6Section 7. 127.06 (1m) (c) 1. of the statutes is amended to read:
SB275,4,97 127.06 (1m) (c) 1. The grain dealer is a Class A grain dealer that buys or sells
8at least $2,000,000 $3,000,000 worth of grain from producers during the grain
9dealer's fiscal year.
SB275, s. 8 10Section 8. 127.06 (1m) (c) 1m. of the statutes is created to read:
SB275,4,1411 127.06 (1m) (c) 1m. The grain dealer is a Class A grain dealer that buys or sells
12at least $2,000,000 but less than $3,000,000 worth of grain from producers during
13the grain dealer's fiscal year if the grain dealer bought or sold at least $2,000,000
14worth of grain from producers during the grain dealer's previous fiscal year.
SB275, s. 9 15Section 9. 127.069 (1) of the statutes is renumbered 127.069 (1) (a) 1. and
16amended to read:
SB275,4,1917 127.069 (1) (a) 1. A warehouse keeper, other than an exempt warehouse keeper,
18that does not meet the financial standards under s. 127.065 (1) shall file monthly
19reports with the department
.
SB275,4,23 20(b) The warehouse keeper shall file each monthly report under par. (a) no later
21than the 10th day of each month. Each monthly report shall state the inventory of
22each type of grain in storage in each of the warehouse keeper's warehouses on the
23last day of the previous month.
SB275, s. 10 24Section 10. 127.069 (1) (a) (intro.) of the statutes is created to read:
SB275,5,2
1127.069 (1) (a) (intro.) All of the following shall file monthly reports with the
2department:
SB275, s. 11 3Section 11. 127.069 (1) (a) 2. of the statutes is created to read:
SB275,5,54 127.069 (1) (a) 2. A warehouse keeper that has filed a bond or other security
5with the department for the benefit of depositors.
SB275, s. 12 6Section 12. 127.069 (2) (a) 4. of the statutes is created to read:
SB275,5,87 127.069 (2) (a) 4. A grain dealer that has filed a bond or other security with the
8department for the benefit of producers.
SB275, s. 13 9Section 13. 127.09 (4) of the statutes is amended to read:
SB275,5,1410 127.09 (4) Maintain sufficient inventory. A warehouse keeper shall at all
11times maintain grain inventories sufficient in quantity and quality to meet all
12outstanding obligations for grain received from or held in storage for depositors. If
13the warehouse keeper is licensed, the warehouse keeper shall maintain the grain in
14a licensed warehouse.
SB275, s. 14 15Section 14. 127.09 (6) of the statutes is created to read:
SB275,5,2116 127.09 (6) Storage by another warehouse keeper. If a warehouse keeper
17delivers grain owned by a depositor to another warehouse keeper for storage, the
18delivering warehouse keeper shall direct the receiving warehouse keeper to issue one
19or more nonnegotiable warehouse receipts to the delivering warehouse keeper for the
20amount of grain delivered. A nonnegotiable warehouse receipt required under this
21subsection may not be a scale ticket.
SB275, s. 15 22Section 15. 127.10 (5) of the statutes is amended to read:
SB275,6,723 127.10 (5) Deferred payment or deferred price contract. (a) A deferred
24payment or deferred price contract shall be in writing. A If the contract is made
25before the grain dealer takes custody of the grain, the grain dealer shall furnish the

1producer with a copy of the written contract within 7 days after the grain dealer and
2the producer enter into the contract. If the contract is not made before the grain
3dealer takes custody of the grain, the
grain dealer shall furnish the producer with
4a copy of the written contract within 7 days after the grain dealer takes title to
5custody of the grain covered by the contract. The contract shall state the price of the
6grain or, in the case of a deferred price contract, the formula by which the price will
7be determined and the deadline by which the price will be determined.
SB275,6,118 (b) A deferred payment contract or deferred price contract shall specify the date
9by which the grain dealer agrees to pay the producer in full. That date may not be
10more than 180 days after the day on which the contract price is established or the
11day on which the grain dealer takes custody of the grain, whichever is later
.
SB275,6,1212 (End)
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